Diagonal Put Spread Calculator

By Dennis Bosmans · Updated June 2026 · 3 min read · Risk disclaimer

A diagonal put spread sells a near-term out-of-the-money put and buys a longer-dated put at a different strike. It is the bearish mirror of the diagonal call: you collect near-term time decay while the longer-dated long put defines the risk and carries the directional view.

Interactive calculator

Edit the price, strikes and premiums to see the payoff update live.

Underlying price

tool_shortPUTStrike Premium

tool_longPUTStrike Premium

Want probability of profit and live Greeks on real prices? Open the Diagonal Put Spread calculator →

Open the Diagonal Put Spread calculator →

Key characteristics

Sell a near-term put, buy a longer-dated put at a lower or different strike.
Profits from near-term time decay on the short put plus a downward drift.
The long-dated put caps the risk and can be kept after the short put expires.
A repeatable, income-plus-direction structure you can roll month to month.

When to use a diagonal put spread

Use it when you are mildly bearish or expect a slow grind lower and want to be paid to wait. Each cycle, the short near-term put decays in your favour, while the longer-dated long put holds value and gives you downside exposure if the move accelerates.

It is the bearish counterpart of the poor man’s covered put / diagonal call family. After the short put expires or is closed, you still hold the long put and can sell another near-term put against it, lowering your cost over time.

Risks and management

The main risk is a sharp drop straight through the short strike early, before time decay helps, or a rally that bleeds the long put’s value. Because the two legs have different expirations, the payoff at the near expiration is model-based, not a simple kinked line.

Roll the short put down and out to follow the stock and keep collecting premium, and watch the long put’s remaining time value — the structure works best when near-term decay outruns the slower decay of your long leg.

Worked example. A stock trades at $100. You sell the 30-day $90 put and buy the 60-day $100 put. The short put decays quickly if the stock holds up, while the long put gives you bearish exposure. If the stock drifts toward $90 by the near expiration, the short put decays and the long put gains — the ideal outcome — and you can then sell another put against the long.

Calculate it live

Use the free OptionProfit Diagonal Put Spread calculator to load a live option chain, build the trade, and instantly see the payoff chart, breakevens, probability of profit, Greeks and a Monte Carlo simulation of outcomes.

Key takeaways

The bearish mirror of the diagonal call: short near-term put, long-dated put.
Earns near-term theta while the long put defines risk and adds direction.
Roll the short put down and out to keep collecting and follow the move.
Different expirations mean the near-term payoff is curved, not a simple V.

Frequently asked questions

How is this different from a calendar put?

A put calendar uses the same strike for both expirations; a diagonal uses different strikes, which adds a directional (bearish) tilt on top of the time-decay edge.

What is my maximum risk?

It is defined by the long put and the net debit/credit, but because the legs expire at different times the worst case depends on where the stock is at the near expiration — model it before trading.

Can I keep the long put after the short expires?

Yes. That is the point — once the short put expires you still own the longer-dated put and can sell a new near-term put against it, lowering your basis each cycle.

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